Speech: People's veto- Rahui Katene
te-pati-maori
Thu Sep 15 2011 12:00:00 GMT+1200 (New Zealand Standard Time)
Speech: People's veto- Rahui Katene
Thursday, 15 September 2011, 9:19 am
Press Release: The Maori Party
Speech: People's veto- Rahui Katene
Spending Cap (People’s Veto) Bill
Rahui Katene, MP for Te Tai Tonga
Wednesday 14 September 2011; 7.30pm
The Spending Cap (People’s Veto) Bill seeks to impose a constitutional limit on spending as a sure way to create fiscal health.
The Maori Party believes this legislation must be opposed at all costs.
As other speakers have noted, in the United States similar laws have been used to bring several states to financial ruin, leading to massive cuts in social services. Thirty states already limit how much their legislatures can spend or raise revenue, devastating funding for education and essential public services in their wake.
While we appreciate the intention is to prevent the state from ever again accumulating a deficit like the one it faces now simply placing limits is a draconian measure designed to just appeal to popular conservatism.
Tea Party republicans have brought the States to the brink of collapse a couple a weeks ago when they exercised a veto over raising the federal spending cap.
The real reason for this bill coming up now is because National is seeking to tidy up loose ends with the confidence agreement it has with Act. In essence this is the desperate breaths of a party seeking to have some influence in the last seven days of Government work programme.
But we say in the strongest possible terms this must not be ACT’s legacy to New Zealand.
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The motivation for Mr Hide bringing this bill up today is to protect the wealthy from having to pay their share of tax.
As a Parliament we must be wary of any popularist attempts to conjure up voting power, lacking sound rationale or academic justification.
Spending discipline is an important ingredient in any recipe to fix the state's budget but putting in place a pre-imposed fiscal cap is a recipe for disaster.
And if our constituents need any proof of that we would simply remind them of the spectacle of the fiscal envelope.
I might remind the National Party of that bleak period in our history.
The late Hepi Te Heuheu attracted 100 percent support from iwi for his stand against this approach. The genesis of the fiscal envelope was that one fixed amount was offered to settle all claims forever, approximately three percent of all appropriations for one year.
The one billion dollar fiscal envelope compared miserably with other transactions of the Crown, leading Maori to believe they were locked into an unhappy partnership with the Crown.
At the time the fiscal envelope was seen as the final straw. A fiscal envelope of $1 billion for the settlement of all historical claims was in effect a definitive limit on what the Crown would pay out in settlements.
Māori vehemently rejected such a limitation in advance of the extent of claims being fully known and as a consequence, the fiscal envelope was subsequently dropped after the 1996 general election.
One might have thought Governments could learn from their mistakes.
Internationally too, the concept of a pre-ordained limit has been met with comparable heat and fury as the fiscal envelope fiasco.
What we have seen happen in Colorado is that their roads declined to the worst shape since the state started monitoring them, the contribution to higher education funding fell from 60 percent to 40 percent, and revenues returned to pre-recession levels.
When the economy was restored to a more positive state of health it was almost impossible to make up what they had cut – a decision which was essentially devastating to public services.
I found some disturbing information about the spending cap concept from Rich Jones, director of policy and research for the Bell Policy Centre – a progressive research group based in Denver. According to Rich Jones, and I quote “it’s been particularly negative on the state, on state government and its ability to retain and raise the amount of revenues that it needs to function effectively”.
Of course we are all in favour of any proposals to rein in spending and lower taxes.
It’s about value for money – and we’re as keen as the next party to look at that.
But there are other things we could do which could tell us about effectiveness, efficiency and the best value for the dollar.
For instance, we could get the Office of the Controller and Auditor General to report annually on the effectiveness of interventions targeted at Maori, Pacific, refugee and migrant communities as well as young people – how effectively is the taxpayer dollar in this regard?
We could be asking for an annual report on the capability of the state sector to achieve outcomes for Maori.
We need – as Nanaia Mahuta said earlier – to be discussing the real issues about value for money for Government.
We want to see more community services and less government bureaucracy for the outcome of whanau restoration. That is the best way of controlling debt, of creating prosperity and growth – not a rigidly imposed fiscal envelope of ACT’s making.
What we really need to see – and what the Maori Party is determined we will see – is to make the Government more accountable and transparent through the unbundling of public money spent on tangata whenua.
We want to be assured of the effectiveness of the taxpayer dollar being realised in outcomes achieved across the social policy sector with the funds allocated for tangata whenua.
In essence, this is the hub of Whanau Ora.
Mr Speaker, when the Spending Cap proposal was rammed through Illinois in the last month there was a furious outcry from citizens concerned about service cuts.
There was an instant reaction from unions and human-service providers oppose the spending-limit measure, including teachers unions, the American Federation of State, County and Municipal Employees, the AARP and Voices for Illinois Children.
So why are we even going there?
The issue is simply put - “the process is not the problem; the problem is the problem.”
Mr Hide and the Act Party are trying to rush through process reform as a substitute for, or distraction from, the tough policy decisions that are needed to actually address the budgetary problem – which is addressing unemployment, household inequality and the endemic and tragic consequences of child poverty amongst our most vulnerable New Zealanders.
The Maori Party will not be supporting this bill.
ENDS
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